Huawei is a Chinese technology company that has grown into a global brand. high-quality technology items. Since its inception in 1987, the Huawei brand has gone a long way. Huawei has grown into a global behemoth in just 30 years, battling against the likes of Apple and Samsung. This raises the question of what Huawei’s key to rapid brand success is. This essay aims to elucidate some of the important reasons that have contributed to Huawei’s success.
The history of the Huawei brand
Huawei Technologies began as a rural sales representative for Hong Kong-based phone and cable network enterprises in 1987 in Shenzhen, China. Huawei first moved into China’s metropolitan areas between 1996 and 1998, as the country’s urban population surged. Huge cities necessitate complicated communication networks, and Huawei has continued to expand and meet this demand at a breakneck pace.
Huawei’s products and solutions are currently in use in more than 170 countries, servicing more than a third of the world’s population. After Alcatel-Lucent and Cisco, Huawei is the third-largest global maker of routers, switches, and other telecommunications equipment by market share, and the company has lately entered the ultra-competitive smartphone race.
Huawei has suddenly emerged from nowhere to become one of the world’s most prominent technological firms, according to many experts. Its biggest advances have been outside of the public eye, as it is primarily a business-to-business (B2B) corporation. Huawei’s expertise is used by telephone and internet carriers to provide services to customers under their own brands, rather than Huawei’s. Huawei has been able to thrive while being somewhat isolated, with up to one-fifth of the world’s population living within its own Chinese boundaries.
The fundamental business of Huawei can be divided into three groups. The Carrier Network Business Group, for example, provides wireless networks, fixed networks, global services, carrier software, core networks, and network energy solutions to practically all major communications carriers throughout the world. Huawei’s managed services division grew at a compound annual growth rate of more than 70% each year for the seven years leading up to 2012, making Huawei the world’s fastest-growing managed services company.
The Enterprise Business Group, the second business group, is the ideal complement. Huawei’s data center and storage devices must analyze, translate, store, and save data once it has been transferred and received through “pipes.”
The Consumer Business Group is the third division, and it is in charge of the company’s drive into the personal handset and smartphone markets. Huawei refers to this as its “pipe approach,” which focuses on data storage and processing, data transmission and dissemination, and data presentation and creation. The brand announced intentions to launch a new cloud business unit in April 2017 as part of a USD 1 billion investment to expand its cloud operations. Huawei’s rotating CEO, Eric Xu, stated that the company has been promoting its new public cloud platform both independently and in collaboration with operators in several countries, including Deutsche Telekom in Germany.
Despite receiving no branding benefits, it was rated third in the global mobile equipment market by 2008. Huawei’s present and future growth strategies include moving up the value chain from component manufacturer to self-branded smartphone maker.
Huawei’s mission is to make communication a better part of people’s lives. Globally, more people are being connected on ever-faster devices, placing higher demands on speed, usability, and a secure and personalized experience. Businesses have their own requirements, and they rely on technology to manage logistics, operations, and many types of customer data. Not just communications, but also interactions between people, things, and the environment are predicted to result in approximately 50 billion connection requests by 2020 from GPS, compasses, cameras, and microphones. Huawei is committed to providing broader, smarter, and more energy-efficient pipes to deal with these digital floods.
Huawei’s main differentiation is its ability to collaborate closely with customers and to be customer-centric. It has established 15 research institutes and centers, as well as 36 collaborative innovation centers, all of which work directly with premier carriers across the world to develop customized technology for each carrier’s specific needs and to give them a competitive edge for customers.
The Boston Consulting Group ranked Huawei as the 46th most innovative firm in the world in 2016. From 2015 to 2016, it ranked #1 in terms of global Patent Cooperation Treaty patent applications for the second year in a row. Huawei has nearly 80,000 research and development employees (45 percent of its total staff) in Germany, Sweden, the United Kingdom, the United States, France, Italy, Belgium, Finland, Ireland, Russia, India, and China.
Huawei recognizes that great brand’s fuel innovation, and it reflects this in its global operations. In 2016, Huawei’s total R&D expenses amounted to 14.6 percent of yearly revenue. The company’s credo of “Might from a small hole” exemplifies this unwavering commitment to innovation. Huawei thinks that if its resources are dedicated to a clearly defined objective of enriching life through communication, it will be able to constantly develop.
Huawei has adopted the concept of portraying its goods as technologically advanced problem-solvers following its successful debut into the smartphone sector. The move from a non-public ODM to a visible brand manufacturer is a difficult one for Huawei to navigate and succeed at. To realize the worldwide potential, the leadership team must work tirelessly.
Huawei must not only grasp present technology levels but also foresee future customer needs in order to remain the first option and best partner of telecom providers. Huawei’s strategies include outsmarting current technology and establishing industry standards.
Today, around 200 fourth-generation networks are commercially available in 75 countries, with another 200 in the planning phases. Meanwhile, Huawei’s R&D teams have been working on fifth-generation (5G) networks for several years, with commercial 5G networks expected to be available by 2020. When the time comes, Huawei’s vision will make it the first to market with 5G technology. Ken Hu, Huawei’s rotating CEO, suggested 5G.
Huawei launched the world’s first 5G phone network on the Isle of Man in 2014.
Huawei is capitalizing on its expansion by establishing itself as a global leader in a variety of industrial standards. Huawei maintains over 20 prominent roles in international standards bodies as a leader in cloud and storage standardization. Huawei can define the future of information technology policy from this position of leadership, allowing it to stay ahead of the competition.
Huawei has made significant progress in harmonizing its internal leadership and hierarchy in order to maintain responsiveness in a fast-paced market. While a chain of command that encourages uniformity and quality control is important for branding, it can be counterproductive to creativity. Huawei has been delegating decision-making authority to customer-facing positions and field offices, fostering idea flow.
Huawei’s rotating CEO system, in which a small group of executives takes turns as CEO, is by far the riskiest, and arguably the most clever, leadership plan. A group of rotating and acting CEOs is seen to be more effective than a single CEO who is required to handle several strategies with in-depth expertise since they have more time to prepare for their next term as acting CEOs. This guarantees that the most senior leadership roles have a broader range of skills over time.
The company’s technical prowess, along with its distinctive senior management style, allows it to think differently about its brand strategy. The company’s corporate marketing and branding theme, “Building a Better Connected World,” was introduced in 2014, demonstrating the company’s goal and future positioning. Huawei follows Apple’s lead in some ways, such as hosting flashy events to raise awareness, but it also invests heavily in public relations and lobbying.
Its marketing activities are tied to a strategy of promoting its products (particularly smartphones) as being the pinnacle of perfection. In 2014, the P7 smartphone’s “Excellence with Edge” ad featured visionaries or trend-setters. In 2015, Huawei’s rotating CEO Ren Zhengfei chose a photo of a dancer’s feet one wearing a silk ballerina shoe for performance, the other displaying bleeding and bandaged barefoot to emphasize the company’s employees’ dedication and effort.
Its marketing activities are tied to a strategy of promoting its products (particularly smartphones) as being the pinnacle of perfection. In 2014, the P7 smartphone’s “Excellence with Edge” ad featured visionaries or trend-setters. In 2015, Huawei’s rotating CEO Ren Zhengfei chose a photo of a dancer’s feet — one wearing a silk ballerina shoe for performance, the other displaying bleeding and bandaged barefoot – to emphasize the company’s employees’ dedication and effort.
Huawei’s product positioning has always made use of its technological expertise. The corporation does not shy away from using adjectives and phrases like “best” and “fastest” to describe its products. The underlying strategy is to link its products to a very high-value proposition. A robust visibility campaign supports the brand strategy.
More than 90% of Huawei’s consumer devices were shipped and marketed under the Huawei brand by 2012. Despite the fact that some telecom providers stopped doing business with Huawei as a result of this, Huawei refused to give up on increasing its brand awareness.
The decline of Sony, Blackberry, and HTC, which has opened up new chances in the consumer retail arena, has also assisted its brand visibility campaign. Aside from China and the United States, the company’s smartphone brands have found lucrative markets in India, Indonesia, Taiwan, and a number of African countries. These fresh prospects have complemented Huawei’s status as an entry-level rival in most areas, allowing it to build and implement a worldwide marketing plan rather than dealing with the complexity of varied market maturity levels.
Huawei’s public relations
In 2005, Huawei reached a watershed moment on the world scene, when international contract orders surpassed domestic Chinese sales for the first time. Huawei revamped its corporate identity to represent concepts of customer-focus, innovation, stability, and harmony, recognizing that an identity change would be required to follow its ascension in the world arena. The new image was created to reflect Huawei’s move from a traditional, local brand to a modern, worldwide one, while also balancing internal challenges.
On May 8, 2006, Huawei unveiled its new visual identity and logo. By the end of 2006, Huawei had been named Frost & Sullivan’s “Broadband Infrastructure Vendor of the Year in the Asia Pacific,” with 31 of the top 50 global Huawei was no longer a rising star, but a global leader.
In 2013, Huawei introduced their ‘Make it Possible’ smartphone effort, which used story-telling around their devices rather than marketing product features to re-imagine itself as a mobile brand rather than solely a B2B service company.
Pricing is another way for brands to communicate. Huawei’s ultra-affordable USD 80 Android phone has enabled it to break into markets that Apple, Samsung, HTC, Microsoft, and Blackberry have largely neglected. Huawei has put tens of millions of smart gadgets in the hands of African youngsters and connected one million African small and medium-sized organizations (SMEs) to the internet in Africa.
Huawei’s pricing approach has centered on ensuring lower prices than most of its competitors, without sacrificing quality or putting the quality of its goods in jeopardy by appearing to be just another low-cost Chinese provider.
Huawei may have to adopt a new pricing strategy for consumers in mature areas like the United States and Europe. Customers utilize cost as a quality and reliability signal, whether consciously or unintentionally. The premium price implies a premium product in these areas. Furthermore, Huawei’s pricing is critical in order to avoid the bad reputation of “Made in China” as low-cost and low-quality.
Huawei risks being labeled as a low-quality option if it enters as a low-cost provider by such a large margin. Huawei launched its first formal mobile marketing campaign in the United States in 2013. However, due to the United States government’s fears that Huawei is operating as a spy for China, Huawei has been repeatedly rejected, barred from bidding on government contracts, and its sales and marketing activities have been severely limited.
By the conclusion of the first quarter of 2014, the company had both formally and informally said that it will not pursue the United States as a market. Currently, Huawei’s leadership maintains that the United States is not a top priority for the company, but it may be in the future.
In the short term, the company’s marketing and communications initiatives have paid off. It was the first Chinese brand to crack the top 100 global brand consultant Interbrand’s rating of the world’s most valuable brands (rank 70) in 2017. This has been possible because of ongoing investments in better brand management, flashy events, public relations, and lobbying. Huawei considered changing its name to make it easier to pronounce for Western consumers but ultimately decided against it.
Huawei’s marketing and advertising efforts are global in character (released in 40+ regions simultaneously) due to a worldwide strategy focused on enhancing brand awareness and visibility. WPP/Ogilvy Mather, Saatchi & Saatchi, and a number of digital agencies are among Huawei’s top marketing and advertising agencies.
The basis of Huawei’s brand strategy has been consistent and strong expenditure in advertising and communications. This will continue as the corporation strives to increase worldwide visibility and awareness of its goods while staying competitive (in terms of marketing spending) with Apple and Samsung.
Huawei’s Future Challenges
Despite its enormous success over the previous 30 years, Huawei faces its own set of commercial issues. Because Huawei operates in the digital and technology sector, where things change at a breakneck pace every day, it is even more critical for the company to prioritize innovation. Huawei will tackle the following obstacles in its quest to “Build a Better Connected World”:
Monopoly control has a finite lifespan, as history has proved. As evidenced by BlackBerry’s slide from dominance, structural realities in every industry have changed and will continue to change. Complacency is the most common error made by successful businesses. Continuing to invest in R&D is insufficient for Huawei. Nokia spent ten times more on research and development than Apple between 2004 and 2007, yet Nokia stubbornly created devices to meet the needs of its present market segment, ignoring the small percentage of consumers who expressed strong interest in future touch screens. Huawei, too, must constantly strive to meet and build future consumer wants rather than present ones.
Despite the fact that Huawei is a completely employee-owned private firm, it will undoubtedly attract the interest of investors looking to profit from its rapid expansion. If it decides to go public and become more widely held, the company’s leadership must avoid the shareholder value syndrome that has befallen many of the industry’s most innovative companies. Because game-changing discoveries are hazardous, the stock market’s reliance on quarterly returns has cemented a management style in most great organizations that resist drastic change. Disruptive inventors are initially met with skepticism by stock markets.
In the United States, the image of a brand is as follows: The United States, where the US government is waging a smear campaign against Huawei, is by far the most challenging issue in Huawei’s global strategy. Due to potential Chinese state influence and security concerns, intelligence authorities have advised American companies not to do business with Huawei. Huawei has been looking for a way to expand into North America for a long time, as the region accounts for roughly 20% of global telecom investment. Huawei has been a political target since a 2007 article revealed CEO Ren Zhengfei’s military past.
Ren worked for the Chinese military as a civil engineering director before founding Huawei in 1987. Huawei currently offers telecommunications equipment to major Internet service providers, who in turn transport data for virtually every government agency. U.S. telecommunications companies should avoid doing business with Huawei, according to the US intelligence committee, because of potential Chinese state influence and security dangers.
To dispel doubts, Huawei has launched a charm offensive aimed at analysts, reporters, and politicians. Members of Huawei’s Board of Directors were also made public. These B2B issues are one of the reasons why Huawei’s rise in America will most likely be driven by smartphones. Because the United States accounts for roughly 20% of global telecom investment, Huawei cannot declare defeat or ignore it entirely.
While it does not have to be the market leader in the United States, it must be recognized as a smartphone brand. If Huawei executes this successfully, it may be a big display of citizenship that earns the company a seat at the table alongside other Asian technology giants in the US, such as Samsung, Lenovo, and LG. Huawei will have to provide more financial and business information in the future in order to be more transparent.